Da Ming: Father, step aside, I'll be the prime minister!

Chapter 193 Zhang Shiyuan's Course: "Small Island Economics"

"Stinky boy!"

Upon hearing the name "A-Zheng," Zhang Juzheng immediately realized that this brat was making up a story to refer to him!
They're becoming increasingly lawless!

But before he could get angry, he was captivated by what Zhang Yunxiu was saying.

The story is simple and clear; it's an easy-to-understand little story, almost like it was told specifically to children.

In the past, Zhang Juzheng had no interest in such "childish jokes".

But today is different. The originally very abstract and difficult-to-understand principles of "economics" and "money-making" have come to life under Zhang Yunxiu's interpretation.

In the story, a fisherman named "A-Zheng" caught more fish than other fishermen with his own fish basket.

Seeing him like this, the fishermen were amazed and asked Ah Zheng to teach them how to make the fish basket.

Ah Zheng then set a rule: he taught the fishermen how to make fish baskets, and for every ten fish the fishermen caught, they would give one to Ah Zheng.

But Zhang Yunxiu continued his story.

"From then on, A-Zheng no longer needed to go out to sea to fish. He was able to live a good life thanks to the 'fishing tax' paid by his people."

He even had more time and energy to improve the fish basket, making fishing more efficient.

Zhang Yunxiu did not say it explicitly, but Zhang Juzheng quickly figured it out.

This so-called "fishing tax" is actually very similar to "land rent" and "land tax".

This story seems to have some merit?

But it seemed too simple, so much so that Zhang Juzheng was eager to know what happened next.

"As time went by, the population of Peach Blossom Island increased, and the demand for fish also grew. Some people began to try other livelihoods, and carpenters, herb gatherers, and cooks emerged as a result."
In order to facilitate better exchange, seashells became a 'general equivalent,' which is what we often call 'silver.'

Upon hearing this explanation, even Wang Shishun's eyes lit up.
He often had thoughts about "silver" in his mind, but he could never quite articulate them.

After Zhang Yunxiu's explanation, everyone immediately understood that the so-called "silver" representing wealth was merely a "general equivalent."

If silver loses the value it represents, it becomes worthless.

It's like being in the desert; even if you have a fortune, what good is it? A gourd of life-saving spring water is far more valuable.

For a moment, Wang Shishun felt a tickle on his head, as if he had grasped something important, yet also as if he hadn't grasped anything at all.

Compared to the merchants sitting inside, Zhang Jianxiu, standing outside, seemed somewhat confused.

"Shells can be used as currency? This is unheard of. Where did Shi Yuan come up with this story?"

Having been mocked by his four sons earlier, Zhang Juzheng finally got his revenge. He stroked his beard and reprimanded them.

"You good-for-nothing, I always tell you to study hard, but you never listen. Now you're here nagging me."

After saying this, Zhang Juzheng began to instruct, shaking his head and gesturing wildly.

The Records of the Grand Historian states, "In ancient times, cowrie shells and tortoise shells were used as commodities. The Treatise on Food and Commodities mentions that ten strings of five cowrie shells were used as goods."

"In ancient times, before gold and silver were discovered, people used cowrie shells as currency. Don't you even know that?"

Zhang Jianxiu scratched his head and said, "Do I have to cite classics just to hear a story?"

Zhang Juzheng ignored him and continued to look into the hall.

In order to help merchants understand economics, Zhang Yunxiu even brought out the later best-selling book "The Economics of the Small Island".

Compared to "The Wealth of Nations" and "Principles of Economics", this book is obviously much simpler.

Zhang Yunxiu made some adaptations, incorporating many economic theories from later generations.

"As technology and wealth accumulated, A-Zheng began to hire a fleet of boats and dozens of fishermen to help him. Some of these people went out to sea to fish, while others assisted him in the research and development of fish baskets."

With the continuous advancement of division of labor and cooperation, Ah Zheng had more people and more boats. The more capital he had, the more money he naturally earned.

This is called the scale effect.

Yang Tiancheng, sitting in the front row, frowned deeply, as if he wanted to memorize everything Zhang Yunxiu had said.

He raised his hand and asked, "Sir, I have a question. The scale effect seems to simply mean that profits increase as the scale increases, but Xishan Workshop cannot be explained so simply. What is the difference between them?"

Zhang Yunxiu glanced at the other person with great appreciation and replied.

"A theorem is a theorem, and reality is reality. Reality is an abstract evolution of the theorem, so it cannot be applied rigidly."

Our Xishan area has economies of scale; it is precisely because of Xishan's large size that it is possible to capture the entire Beijing market.

However, there are also specific aspects of economies of scale. For example, after production scale increases and internal cost optimization is implemented, product costs decrease, and Xishan briquettes can naturally be sold at a lower price.

Zhang Yunxiu's answer to Yang Tiancheng's question was clearly more insightful.

This piqued Zhang Juzheng's interest as he looked into the school, at the merchants with their bright eyes and Yang Tiancheng with his eager gaze.

He suddenly remembered a saying—"Education should be provided to all without discrimination."

The Analects says, “To be learned and resolute, to inquire earnestly and to reflect closely, therein lies benevolence.”

Enabling everyone in the world to read and learn etiquette was the lifelong ideal of many Confucian scholars.

At this moment, everything seems to come into being.

Zhang Juzheng was unwilling to disrupt this situation, and instead focused his attention on this "island economics".

"As trade developed, merchants emerged, who bought goods from a small island at low prices and then resold them at higher prices, profiting from the difference."
A merchant named Aju took advantage of the abundance and low price of timber on Peach Blossom Island and sold it to neighboring islands to make a profit from the price difference.

However, trade was not smooth sailing. A neighboring island was hit by a typhoon, and the islanders were in dire straits, with no extra money to buy Aju timber.

"Aju naturally lost everything." It's a very simple story, but Zhang Juzheng still understood from it the recurrence of the "supply and demand relationship".

For him, the theory was not difficult to understand, but what he lacked were examples of combining unfamiliar theories with practice.

Seeing the merchants' radiant appearance and Yang Tiancheng's thirst for knowledge...

Zhang Juzheng couldn't help but feel a little emotional.

The policy of "emphasizing agriculture and suppressing commerce" was not first coined by Zhu Yuanzhang.

Since Shang Yang's reforms in the Qin state, these have been the guiding principles promoted by successive dynasties and have remained unchanged for thousands of years.

Qin Shi Huang even listed "merchants," "sons-in-law," and "convicts" as among the "seven categories of exiles," conscripting them to guard the frontier or perform forced labor.

It can be said that for nearly two thousand years, merchants have held a lowly status.

Today, Zhang Juzheng saw something different in the experiences and theories of his youngest son, Zhang Yunxiu, as well as in what he saw and heard.

Merchants need not be "cheap," and the court need not be afraid of anything that brings profit.

This "way of commerce" can also be a way to save the country!
Following that, Zhang Yunxiu used the bankruptcy of "Aju" to discuss loan relationships.

Taoyuan Island's economy is booming. Through a small fishing activity, multiple industries such as handicrafts, commerce, and transportation have developed together.

When fishermen see that a certain industry is profitable, they flock to it, blindly following the trend and creating a "herd effect".

In Zhang Juzheng's view, this was a manifestation of disrupting the supply and demand relationship.

Furthermore, for "Aju" to expand his business, it's not always better to have more; once a certain limit is reached, the money he earns will decrease.

Zhang Yunxiu called it the "marginal effect".

However, in Zhang Juzheng's view, this also needs to be considered within the scope of "supply and demand".

Even Zhang Juzheng keenly sensed that this so-called "marginal effect" was also related to the business rivalry between Xishan and the Shanxi merchants.

Instead of expanding, "Aju" opened a fishing shop, specializing in teaching fishermen how to adjust their catch according to the season and market conditions.

As the quality of seafood from the islands improved, it was gradually sold to other islands, which brought us back to the "economies of scale" effect.

Not only Zhang Juzheng, but also the merchants in the school listened with rapt attention.

Wang Shishun sighed and said, "When I hear the stories told by Magistrate Zhang, I often think of myself. I never imagined that my unintentional actions would have so many intricacies. It's truly astonishing."

"A revelation! A truly enlightening experience!"

One of the merchants shouted loudly, but when his companion asked him what exactly the "enlightenment" was, he couldn't answer a single question.

Zhang Yunxiu was quite satisfied with the results, after all, one cannot become fat in one bite.

The establishment of new disciplines and the popularization of new ideas inevitably require a slow process of acceptance.

He turned his gaze to Yang Tiancheng and said meaningfully.

"What insights have you gained?"

Yang Tiancheng put down his pen. The manuscript on the table was already filled with notes. He thought for a moment and said.

"The student has thought a lot and realized that the teacher has put a lot of thought into it. The economy of this small island is just like a miniature version of the Ming Dynasty."

The Ming Dynasty had been established for over two hundred years, and the problems it faced were already complex. The most important issue was that it placed too many restrictions on merchants and paid too little attention to economic principles.

If the imperial court could be as pragmatic and focused on economic development as Peach Blossom Island, then the predicament of our Great Ming Dynasty could be resolved.

Upon hearing this, Zhang Yunxiu was startled and wished he could cover the other person's foul mouth. He then said with a stern face.

"Don't talk nonsense! Peach Blossom Island is Peach Blossom Island, and the Ming Dynasty is the Ming Dynasty. Do you want to harm your master?!"

Reflecting on the affairs of the court is a serious crime, and Zhang Yunxiu is now becoming increasingly cautious, at least in front of outsiders.

Yang Tiancheng shrank his neck and nodded quickly.

"Please forgive me, Magistrate Zhang; I misspoke."

After this little incident, Zhang Yunxiu turned to the crowd with his hands behind his back and said...

"That concludes today's lecture. You may all return home now. Please review the pamphlet of 'Zhang Shiyuan's The Wealth of Nations' that I have given you. I will check it myself in the future."

"Thank you, Magistrate Zhang!"

Wang Shishun was already full of admiration and was about to take his leave when he heard that they would be checking homework. Immediately, everyone's face fell.

Zhang Shiyuan just loves to mess with people!
But they dared not say anything, and each of them left the school with their booklets in their pockets, each with their own thoughts.

Zhang Yunxiu looked specifically at Yang Tiancheng and said, "Kid, don't go back to the clinic anymore. Just stay at Peiwen Academy. We happen to be short of teachers. You can learn economics from me, and also learn chemistry and biology. You can also teach the children elementary education and medicine from time to time."

Yang Tiancheng didn't know what chemistry and biology were; he only knew that he loved economics, so he nodded vigorously and said that.

"I will heed the teachings of my master."

Zhang Yunxiu couldn't understand the term "Grandmaster" anymore. He then remembered that he had taken Yang Jishi as his disciple, so wasn't Yang Tiancheng his grand-disciple?

After all this, the generational hierarchy has become quite messed up.

After giving Yang Tiancheng some more encouragement, Zhang Yunxiu finally let him go.

Once the schoolroom was empty, Zhang Yunxiu squinted, glanced at a corner, and said with a smile.

"How much longer is Father going to hide?"

(End of this chapter)